Question

Many of the causes were linked to irresponsible behaviors throughout the 1920s by companies, banks, governments, and American consumers. Please discuss 1 of these irresponsible behaviors and describe in detail how this behavior contributed to the Great Depression.

Answer 1

There are multiple aspects which led to the great depression of 1920.one of the crucial was the stock market crash in 1929.early in the 1920 consumer spending was at its highest peak in United States. Companies in America where usually producing gives in mass amount and the consumer's where purchasing the same. The failure of the banks led to the depression and vice versa. Those people had their money in the bank's lost their hard earned money. Deflation lead to the increase in real burden caused by the debt which resulted in very less income of the forms as well as the households for repayment of their debts. Deflation was an irresponsible act. Firms producing maximum quality was an irresponsible job from their end. Consumer spending vigorously was an irresponsible act from consumers perspective. There were increase in defaulters as well as increase in bankruptcy which resulted in failures of thousands of banks. the gold standard played a significant role in the spread of the great depression. The output and deflation was declining in United States gave rise to trade surplus as there in pots reduced and there were cheaper exports. This poses a threat to the devaluation of currencies of those countries whose reserve of gold had depleted. also reducing International landings and terrace had contributions to the great depression.